Show multiple sales tax items on an invoice

When one sales transaction has multiple tax rates, you may need to show those different tax rates separately on the printed sales form for your customer.

Some places, such as Puerto Rico, require multiple sales tax rates to be displayed separately on printed sales forms. For example, Puerto Rico currently has a Sales & Use Tax rate of 5.5%. If the sale is made in a municipality such as San Juan, an additional 1.5% tax may be required. In this instance, both tax rates must be displayed on the printed sales form.

Other times you may be required to apply one tax rate to the entire sale, and a second tax rate to the sale up to a certain dollar amount. For example, the entire sale is taxable at 4% but the first $5000 is eligible for an additional 1% tax. Specially if both taxable and nontaxable items are sold in any of these situations, you can see how this can cause minor complication in recording sales tax.

For these instances, we recommend that you use a subtotal item and multiple tax items in your sales forms.

Display multiple tax rates

1. Set up sales tax items.
   1. From the Lists menu, select Item List.
   2. In the Item List window, right-select anywhere and select New.
   3. Select Sales Tax for item type.
   4. Enter the Sales Tax Name, Description, Tax Rate (%), and Tax Agency information.
   5. Select OK.
   6. Repeat steps a through e to enter as many sales tax items as needed.
2. Create a subtotal item.
   1. From the Lists menu, select Item List.
   2. In the Item List window, right-select anywhere and select New.
   3. Select Subtotal for item type.
   4. Enter the the Item Name/Number and Description information.
   5. Select OK.
3. Create the invoice using multiple sales tax items.Important: Before continuing with these steps, you must verify that the default tax in the box below the body of the invoice is a 0.0% sales tax item to allow the body of the invoice to properly calculate the sales tax rates by item.
   1. From the Customers menu, select Create Invoices.
   2. Enter all the taxable items. Do NOT include any non-taxable items. They will be added later.
   3. Add the taxable code to the right of each related item.
   4. To generate a subtotal, enter the subtotal item after entering all taxable items. If you are calculating a tax based on a certain threshold sales amount, add the subtotal item below all the taxable items up to that amount. You can add the remaining taxable items along with the non-taxable items in step f.
   5. Enter the appropriate sales tax item directly below the subtotal item to calculate tax on the subtotal amount. Note that using a subtotal item on an invoice does not affect sales or commission reports.
   6. Enter any nontaxable items that are not subject to sales tax. Add non-taxable code to the right of each item as appropriate.
   7. Select Save & Close.